UKCI has announced an approximate £14 million agreement with H1 Holdings to support the development of 250 MW of wind energy projects across South Africa.
The UK Climate Investments (UKCI) has announced an approximate £14 million (R253 million) agreement with H1 Holdings to support the development of 250 MW of wind energy projects across South Africa.
According to the agreement, UKCI will help in the financing of the development of the Kangnas Wind Farm in the Northern Cape province worth 140 MW on completion and the Perdekraal East Wind Farm in the Western Cape province which will have a generation capacity of 110 MW. The financing will be provided through an innovative funding mechanism developed by UKCI in close consultation with H1 Holdings and designed to support Black Economic Empowerment (BEE) entities.
The UKCI, which is a joint venture between the Green Investment Group and the UK Government’s Department for Business, Energy and Industrial Strategy, under the agreement will also provide critical financing for the development of the 4 MW Kruisvallei Hydro project in the Free State province.
The projects are expected to be completed by the end of 2020 and provide enough clean electricity to power nearly 200,000 homes each year. During their lifetime, they will help avoid approximately 844,000 tonnes of greenhouse gas emissions per annum.
Richard Abel, managing director of UKCI, said that over 90 percent of electricity generation capacity in South Africa currently relies on fossil fuels.
“Our partnership with H1 Holdings supports the country’s transition to a new energy mix – promoting cleaner growth in southern Africa’s largest economy whilst stimulating economic development in rural areas and supporting increased BEE participation in the renewables sector.”
In addition to promoting cleaner growth, the projects will stimulate rural development by employing and training at least 40 percent of construction, operations and maintenance staff from local communities.
Reyburn Hendricks, CEO of H1 Holdings, said that H1 Holdings is proud to be working with UK Climate Investments on promoting access to cleaner electricity in southern Africa.
“Energy is a highly capital-intensive industry and access to finance is a challenge across the industry for all players. Our partnership will help to address the need for new generation capacity in South Africa.”